Realtors are facing an unprecedented number of indecisive buyers in the current real estate market, as potential homeowners become more selective. According to a report by Redfin, nearly 56,000 home-purchase agreements were canceled in June, representing 15% of all homes that went under contract that month. This marks the highest percentage recorded for June.
Julie Zubiate, a Redfin Premier real estate agent in the San Francisco Bay Area, noted that the increase in cancellations is due to buyers who are hesitant to move forward with purchases, often backing out for minor issues. She highlighted that the high monthly costs associated with home buying make buyers more particular about their lists of must-have features.
Rafael Corrales, another Redfin agent based in Miami, reported witnessing significant last-minute cancellations over small details. In June, approximately 2,500 home purchases were abandoned in Miami, accounting for about 17.6% of contracts. Corrales emphasized that the overarching concern is affordability in the current market.
The median sale price for homes reached a historic $442,525 in June, while the average rate for a 30-year mortgage stood at 6.92%. In addition to these elevated home prices and mortgage rates, potential buyers are also challenged by rising insurance, property taxes, HOA fees, and other ownership costs, all intensified by inflation.
The national decline in affordability has led to the largest drop in home sales in eight months, according to Redfin. Monthly sales fell by 0.5% in June, marking the steepest decrease since October 2023. Year-over-year, home sales saw a decline of 1.1% and were 21.5% lower than pre-pandemic levels.